Dear Customer,

As a global organization, we, like many others, recognize the significant threat posed by the coronavirus.

During this time, we have made some of our learning resources freely accessible. Learn more about these useful resources on our COVID-19 page.

Our distribution centers are open and orders can be placed online. Do be advised that shipments may be delayed due to extra safety precautions implemented at our centers and delays with local shipping carriers.

And yet, against the odds and against expectations, growth continues, wealth rises, international influence expands. The coming collapse of China is always coming, never arriving.

Thomas Orlik, a veteran of more than a decade in Beijing, turns the spotlight on China's fragile fundamentals, and resources for resilience. Drawing on discussions with Communist cadres, shadow bankers, and migrant workers, Orlik pieces together a unique perspective on China's past, present, and possible futures.

From Deng Xiaoping's reform and opening to Donald Trump's trade war, Orlik traces the policy steps and missteps that have taken China to the brink of a "Lehman moment" credit crisis. Delving into the balance sheets for banks, corporates, and local governments, he plumbs the depths of financial risks. From Japan in 1989, to Korea in 1997, to the U.S. in 2007, he positions China in the context of a rolling series of global crisis.

Mapping possible scenarios, Orlik games out what will happens if the bubble that never pops finally does. The magnitude of the shock to China and the world would be tremendous. For those in the West nervously watching China's rise as a geopolitical challenger, the alternative could be even less palatable.

China

The Bubble that Never Pops

Thomas Orlik

Table of Contents

Chapter 1: A Tree Cannot Grow to the SkyChapter 2: China's Debt Mountain - the BorrowersChapter 3: China's Debt Mountain - the LendersChapter 4: China's First Two CyclesChapter 5: China's Third Cycle and the Origins of the Great Financial CrisisChapter 6: China's Economy in the Great Financial CrisisChapter 7: Xi Jinping and the Start of China's Fourth CycleChapter 8: Deleveraging Without Self DetonatingChapter 9: Technology Transfer and Trade TariffsChapter 10: This Time it's Different?Chapter 11: War-Gaming a China CrisisChapter 12: It's Never Too Late

China

The Bubble that Never Pops

Thomas Orlik

Author Information

Thomas Orlik spent eleven years in China as Chief Asia Economist for Bloomberg and as a journalist for the Wall Street Journal. He is currently the Chief Economist for Bloomberg, based in Washington DC. He is the author of Understanding China's Economic Indicators.

China

The Bubble that Never Pops

Thomas Orlik

Reviews and Awards

"Bears have written off the chances of continued Chinese success, again and again. They have always been proved wrong. In his detailed account, Orlik demonstrates that a massive accumulation of debt and declining returns on investment threaten China's economy yet again. But, as he explains, not only are policymakers aware of the risks, but China also has great strengths: a competent state, a huge domestic market, and continued potential for rapid catch-up growth. Will the bears be right at last? Probably not." -- Martin Wolf, Chief Economics Commentator, Financial Times

"Orlik is one of the most astute and entertaining observers of the Chinese economy. His fluid writing style makes the work accessible to specialists and non-specialists alike. This is a book that anyone interested in China's future and its consequences for the global community should read." -- Tony Saich, Daewoo Professor of International Affairs, Harvard Kennedy School

"This excellent book unpacks the many mysteries of the Chinese economy in a compelling and cogent manner. Orlik has brought together his journalistic and analytical skills to produce a lively and informative account of how China has sustained its phenomenal growth performance while apparently flouting conventional economic precepts. A must-read for anyone who wonders if China's economy is doomed to collapse, why it hasn't already, and why it might never do so." -- Eswar Prasad, Cornell University and Brookings Institution, author of Gaining Currency: The Rise of the Renminbi

"Orlik opens the Chinese financial system up to outsiders. He unwraps complex institutions through cases that are always clear and concrete, often amusing, and on occasion, downright alarming. While laying bare the problems, Orlik is also careful to acknowledge the hidden sources of strength in the Chinese system. By the end of this accessible account, readers have been given the information they need to make up their own minds about the balance of risks and strengths in the Chinese financial system. Highly recommended to anyone concerned with the Chinese economy." -- Barry Naughton, Professor, School of Global Policy and Strategy, UC San Diego

"Orlik covers complex debates in crystal-clear prose, spiced up with anecdotes from his years on the ground in China. His book serves as a primer on China's modern economic history, but, most importantly, lays out a strong contrarian case for why it can avoid a future crisis." -- Simon Rabinovitch, Asia Economics Editor, The Economist

"No one is better equipped to help us understand and to prognosticate the outcome of China's debt problem than veteran analyst Tom Orlik. This book has a rare combination of intense focus on the details of this complex problem and a lucid style which makes it a fun and engaging read to the educated public. Readers should prepare themselves for a wild ride through the twists and turns of a potential Chinese financial crisis." -- Victor Shih, Ho Miu Lam Chair Associate Professor in China and Pacific Relations, UC San Diego

"Orlik plucks vivid examples from all over China to tell the story of the economy's remarkable rollercoaster ride. Beijing has defied the odds to survive four momentous economic cycles in forty years, Orlik explains. Aided by clear writing style and a healthy dose of good humour, he determines how China might reinvent its economy for a fifth time." -- Celia Hatton, Asia Pacific Editor, BBC

"Thomas Orlik's China: The Bubble that Never Pops provides a valuable historical overview of the build-up of debt in the world's second-largest economy over the last two decades. The author's deep knowledge and perceptive analysis make the book a timely contribution to our understanding of China's state-capitalist financial system and inefficient allocation of capital." -- Minxin Pei, author of China's Crony Capitalism

"Orlik takes a dispassionate look at how, despite massive debt, non-performing loans, white elephant projects, and infamous ghost cities, China's economy has defied all the nay-sayers - at least for now. In China: The Bubble that Never Pops, Orlik offers an inventory of the policy tools - often unavailable to western central bankers and political leaders - that China's Party technocrats have used to manage the economy and prevent or forestall hard landings. Lucid and highly readable, this is one of those rare books that manage to be accessible to non-specialists while still offering ample detail and data to those steeped in the arcana of the Chinese economy." -- Kaiser Kuo, host of The Sinica Podcastr on SupChina.com

"Mr. Orlik does an excellent job of explaining why China's economy keeps confounding those who have predicted for years that it is a bubble about to pop. But he is no wide-eyed naif, rather he walks readers through all the issues and risks and help us understand how policymakers keep things together, while making clear that the risk of an eventual crisis is real." -- Bill Bishop, Publisher, Sinocism

"Orlik musters his deep knowledge (and dry wit) to explain the stresses building beneath China's remarkable growth. The author mines his experiences as journalist and analyst covering China and Asia to provide clear comparative examples - he deploys 1980s Japan, 1990s Korea, and the catastrophic sub-prime crisis in the US, to illuminate the decisions taken by Chinese policymakers. This book is an accessible primer for anyone who wishes to understand China's choices today." -- Lucy Hornby, China correspondent, Financial Times

"China watchers too often fall into one of two extreme camps: those who see everything through rose-tinted spectacles and those who can only see disaster ahead. Tom Orlik's book is, thankfully, much more nuanced. Written in an engaging style and peppered with anecdotes, "China: The Bubble that Never Pops" should be required reading for anyone seeking to understand how the Middle Kingdom has emerged to become the world's second largest economy."-- Stephen King, Senior Economic Adviser, HSBC, and author of Grave New World